In a robust economic performance, India is expected to record a GDP growth of 7% during the second quarter of the current fiscal year, surpassing the Reserve Bank of India’s projections, as reported by ICRA. The firm attributes this growth to sustained strength in investment activities, with seven out of eleven investment-related indicators showing improved year-on-year growth.
ICRA notes that despite challenges such as uneven rainfall, narrowing differentials in commodity prices, and potential slowing of government capex momentum, the country’s GDP is likely to exhibit resilience. However, it maintains a cautious outlook for the second half of the fiscal year, projecting a GDP growth estimate of 6.0%, slightly below the MPC’s projection of 6.5%.
During Q2, investment activity remained robust, with key indicators like CV registrations, cement production, states’ capital outlay, and the Government of India’s capex witnessing double-digit expansion. The report highlights the positive momentum in construction activity and acknowledges the challenges ahead, including potential impacts from external factors.
